Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation
Framework: Financial Technology (FinTech) is an industry composed of diversified firms that combine financial services with innovative technologies. The research question and main goal are attempting to answer whether they are more similar to traditional banks or trendy technological firms deploying...
| Main Authors: | , , |
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| Format: | info:eu-repo/semantics/article |
| Language: | English |
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MDPI
2020
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| Subjects: | |
| Online Access: | http://hdl.handle.net/10835/9171 |
| _version_ | 1789406524546744320 |
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| author | Moro Visconti, Roberto Cruz Rambaud, Salvador López Pascual, Joaquín |
| author_facet | Moro Visconti, Roberto Cruz Rambaud, Salvador López Pascual, Joaquín |
| author_sort | Moro Visconti, Roberto |
| collection | DSpace |
| description | Framework: Financial Technology (FinTech) is an industry composed of diversified firms that combine financial services with innovative technologies. The research question and main goal are attempting to answer whether they are more similar to traditional banks or trendy technological firms deploying their innovativeness to favor financial inclusion and sustainability. Justification: Evaluators may wonder if FinTechs follow the typical evaluation patterns of bank/financial intermediaries or those of technological firms. Preliminary empirical evidence shows that the latter interpretation is the one consistent with the stock-market mood. Objective: This study goes beyond the extant literature, analyzing the differences between FinTechs and traditional banks in market valuation, and showing the potential for digital interaction and cross-pollination of complementary business models. Methodology: The differences will be empirically analyzed with the stock market valuation and the multipliers associated with these firms. Results: The main contribution of this paper is that the appraisal approaches of FinTechs follow those of technological startups, having a revenue model much more scalable than that of a typical bank. FinTechs may so provide a solution for sustainable finance with microfinance and crowdfunding among others. FinTechs and traditional banks may eventually converge towards a common market exploiting co-opetition strategies. |
| format | info:eu-repo/semantics/article |
| id | oai:repositorio.ual.es:10835-9171 |
| institution | Universidad de Cuenca |
| language | English |
| publishDate | 2020 |
| publisher | MDPI |
| record_format | dspace |
| spelling | oai:repositorio.ual.es:10835-91712023-04-12T19:07:32Z Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation Moro Visconti, Roberto Cruz Rambaud, Salvador López Pascual, Joaquín financial innovation value chains scalability digital platforms financial ecosystem discounted cash flows market value Sustainable Development Goals Framework: Financial Technology (FinTech) is an industry composed of diversified firms that combine financial services with innovative technologies. The research question and main goal are attempting to answer whether they are more similar to traditional banks or trendy technological firms deploying their innovativeness to favor financial inclusion and sustainability. Justification: Evaluators may wonder if FinTechs follow the typical evaluation patterns of bank/financial intermediaries or those of technological firms. Preliminary empirical evidence shows that the latter interpretation is the one consistent with the stock-market mood. Objective: This study goes beyond the extant literature, analyzing the differences between FinTechs and traditional banks in market valuation, and showing the potential for digital interaction and cross-pollination of complementary business models. Methodology: The differences will be empirically analyzed with the stock market valuation and the multipliers associated with these firms. Results: The main contribution of this paper is that the appraisal approaches of FinTechs follow those of technological startups, having a revenue model much more scalable than that of a typical bank. FinTechs may so provide a solution for sustainable finance with microfinance and crowdfunding among others. FinTechs and traditional banks may eventually converge towards a common market exploiting co-opetition strategies. 2020-12-18T08:50:40Z 2020-12-18T08:50:40Z 2020-12-10 info:eu-repo/semantics/article 2071-1050 http://hdl.handle.net/10835/9171 en https://www.mdpi.com/2071-1050/12/24/10316 Attribution-NonCommercial-NoDerivatives 4.0 Internacional http://creativecommons.org/licenses/by-nc-nd/4.0/ info:eu-repo/semantics/openAccess MDPI |
| spellingShingle | financial innovation value chains scalability digital platforms financial ecosystem discounted cash flows market value Sustainable Development Goals Moro Visconti, Roberto Cruz Rambaud, Salvador López Pascual, Joaquín Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation |
| title | Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation |
| title_full | Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation |
| title_fullStr | Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation |
| title_full_unstemmed | Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation |
| title_short | Sustainability in FinTechs: An Explanation through Business Model Scalability and Market Valuation |
| title_sort | sustainability in fintechs: an explanation through business model scalability and market valuation |
| topic | financial innovation value chains scalability digital platforms financial ecosystem discounted cash flows market value Sustainable Development Goals |
| url | http://hdl.handle.net/10835/9171 |
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